Georgia Release of Lien Bond |
AmeriPro Surety Bonds| 844-589-9732
In Georgia, the mechanic’s lien bond is in an amount that is TWICE the amount of the lien. The bond is only secured by full cash collateral in the form of a wire or a cashier’s check. Real or personal property — essentially any non-cash items — are not an acceptable form of collateral. The premium, distinct from the collateral, is a minimum of $770 or 1% of the bond amount, whichever amount is greater. The premium also renews annually for as long as the bond is active. Premiums when paid, are earned in full.
To understand what a release of lien bond is, it’s important to first understand the definition of a mechanic’s lien.
A mechanic’s lien occurs when work is completed on a property and there is some dispute about the work and, consequently, the work is not paid for; or this is allegedly the case .
The contractor or person who has performed the work files a lien against the property. The lien may prevent the property from being refinanced, sold, or transferred, until the lien has been satisfied and released.
- We will need a copy of the recorded lien and a corresponding Court case to facilitate procuring this surety bond.
Georgia Release of Lien Bond: What this Bond Is
In a court proceeding between a property owner, and a contractor, the judge will sometimes order the owner of the property to file a release of lien bond. The Georgia release of bond therefore is this:
It is a surety bond which allows a mechanic’s lien to be released from a property, and instead transfers the lien to the surety bond.
Georgia Release of Lien Bond: The Amount that You Must File
According to §44-14-364 of O.C.G.A the amount of the release of lien bond to be filed
- is twice the amount of the lien claimed;
- In cases which involve residential property, the amount of the surety bond required is the amount of the lien claimed.
The Georgia release of lien bond is typically backed by full collateral. This means that the purchaser, or principal of this surety bond, backs the bond fully with cash.
In lieu of cash, an irrevocable letter of credit from your (or, if legal counsel, your client’s) banking institution constitutes the same thing.
In Addition to the Full Collateral: Premium Which Renews Annually
In addition to the full collateral required of a release of lien bond, there is the premium required. The premium represents a certain calculated percentage of the bond’s amount, usually approximately 2% of the bond’s face value.
The premium also renews annually, for as long as the lien is being litigated in court.
AmeriPro Surety Bonds provides court surety bonds throughout Georgia. We are a surety bonds only agency which provides bonds nationwide.
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